
(WASHINGTON) -- The Federal Reserve is set to announce its latest decision on interest rates on Wednesday as the central bank weathers the highest inflation in three years.
The announcement will mark the first possible adjustment of the benchmark interest rate since Trump nominee Kevin Warsh began his four-year term as Fed chair last month.
The policy move is also set to arrive at a moment of flux for the nation’s economy, just days after an agreement between the United States and Iran offered hope for some price relief.
The U.S.-Iran accord, set to be formally signed on Friday, came as gasoline prices fell below $4 a gallon for the first time since March. Still, fuel costs stand well above pre-war levels, and an array of grocery prices remain elevated.
Futures markets overwhelmingly expect the Fed to hold interest rates steady when policymakers meet on Wednesday, according to the CME FedWatch Tool, a measure of investor sentiment.
In recent weeks, however, odds have risen for a potential interest rate hike by the end of 2026, the tool showed, granting a roughly four in 10 chance of a quarter-point increase in December.
The shift in expectations came after a stronger-than-expected jobs report earlier this month showed robust hiring in May. In theory, a resilient labor market could afford central bankers leeway to raise interest rates in an effort to dial back inflation, since elevated borrowing costs risk a hiring slowdown.
Inflation jumped for a third consecutive month as the Iran war continued to drive up prices in May, surpassing 4% for the first time in three years
The Middle East conflict prompted the Iranian closure of the Strait of Hormuz, a maritime trading route that facilitates the transport of about one-fifth of global oil supply. The standoff triggered one of the largest oil shocks ever recorded, sending gasoline prices surging.
On Monday, President Donald Trump announced a U.S.-Iran deal that included plans to reopen the strait. Iranian Deputy Foreign Minister Kazem Gharibabadi confirmed the deal had been finalized and said it would be signed in Switzerland on Friday. Oil prices fell to their lowest level since March.
The benchmark rate stands at a level between 3.5% and 3.75%. That figure marks a significant drop from a recent peak attained in 2023, but borrowing costs remain well above a 0% rate established at the outset of the COVID-19 pandemic.
The rate decision will be the first major policy move overseen by Warsh, who will address reporters during a customary press conference minutes after the central bank issues its announcement.
During his term as a Fed governor in the late 2000s and early 2010s, Warsh gained a reputation as an interest-rate "hawk," meaning he generally preferred higher interest rates as a means of ensuring low and stable inflation.
Last year, Warsh voiced support for lower interest rates. At his Senate confirmation hearing in April, Warsh emphasized the threat posed by elevated inflation.
"When inflation surges -- as it has done in recent years -- grievous harm is done to our citizens, especially to the least well-off," Warsh said.
Bucking typical norms, former Fed Chair Jerome Powell Powell will cast a vote on interest rates as a member of the Fed's 12-person policymaking board.
Powell said he would stay on at the central bank's board of governors after his term as chair expired as an investigation into the Fed's office renovation continues.
The Department of Justice moved to drop a criminal probe into Powell in April, calling on the Fed's inspector general to carry out the investigation into cost overruns tied to the renovation. Powell will remain on the Fed's board for an indeterminate length of time, he said last month.
The criminal investigation into Powell focused on alleged false testimony to Congress about an office renovation. Powell, who was appointed by Trump in 2017, has rebuked the probe as a politically motivated effort to influence interest-rate policy. Trump denied any involvement in the criminal investigation.
Copyright © 2026, ABC Audio. All rights reserved.
RUSK COUNTY — Following a fatal crash in Rusk County on Saturday afternoon, one man was arrested after it was discovered he had allegedly caused the crash while driving intoxicated. According to an affidavit from the Rusk County Sheriff’s Office and our news partner KETK, a trooper was dispatched to a multi-vehicle crash at the intersection of FM 3053 and FM 1639 in Gregg County.
WOOD COUNTY – One man died on Sunday after an 18-wheeler hydroplaned and crashed into his vehicle on Highway 80 near Mineola. The Texas Department of Public Safety told our news partner KETK that 45-year-old David Earl Johnson of Grand Saline was driving his Ford Fusion west on Highway 80 about half a mile west of Mineola at around 10:47 a.m. on Sunday, as an 18-wheeler was heading east.
GILMER – Mrs. Baird’s partnered with the East Texas Food Bank last week to donate over 11,000 loaves of bread to families across the area this summer, according to our news partner KETK.
NEW YORK (AP) — Stock markets rallied worldwide Monday, and oil prices eased after the United States and Iran reached a tentative deal to extend their ceasefire and reopen the Strait of Hormuz to get the global flow of crude going again.
WOOD COUNTY – One man died on Sunday after an 18-wheeler hydroplaned and crashed into his vehicle near Mineola. According to our news partner KETK, the Texas Department of Public Safety said that 45-year-old David Earl Johnson of Grand Saline was driving his vchicle west on Highway 80 about half a mile west of Mineola at around 10:47 a.m. on Sunday, as an 18-wheeler was heading east. 


TATUM, Texas (KETK) – One man has been arrested after an alleged aggravated assault happened at an apartment complex in Tatum on Saturday morning. According to the Tatum Police Department and our news partner KETK, a Tatum PD patrol officer and deputies from the Rusk County Sheriff’s Office responded to a reported aggravated assault at an apartment complex in Tatum at around 12:54 a.m. on Saturday.
ATHENS – The City of Athens has announced that several roads around the city have been closed by flooding as heavy storms move across East Texas. The flooding comes as the National Weather Service has extended a flash flood warning across much of western Henderson County until 10 p.m. The warning includes all of Athens, Log Cabin, Malakoff, Cross Roads and Cayuga.
EAST TEXAS — EAST TEXAS — East Texans will be watching closely on Saturday, June 13, as results come in for key local races across the region — in Longview’s District 3 City Council race in Gregg County, Brandon Smith defeats Marlena Cooper with 52.22% to Cooper’s 47.78% with all votes counted.
TYLER — A robot scanning Tyler’s sidewalks to learn about their accessibility was hit by a truck during its first day on duty Thursday. The Daxbots were first deployed to help with Tyler’s Americans with Disabilities Act Self-Evaluation and Transition Plan on Wednesday. Then, less than a week into the robots’ first deployment in Tyler, one of the robots was struck by a truck at the intersection of West Martin Luther King Jr. Boulevard and North Palace Avenue.
VAN ZANDT COUNTY — The Myrtle Springs Volunteer Fire Department demolished their aging fire station building on Saturday, citing serious safety problems and a lack of funding for renovations. According to our news partner KETK, the department currently covers 3000 residents living within the 30 mile-wide Myrtle Springs area of Van Zandt County. Their fire station building has endured many problems like mold, rot, rodent infestations, unsafe structural conditions and unsafe electrical conditions.
LONGVIEW — A former Longview coach was sentenced to 16 years in prison Friday after he was found guilty of sexually assaulting and grooming one of his former students. According to our news partner KETK, former owner and coach of a local gymnastics center in Longview, Matthew Orban, 52, was charged with sexual assault of a minor in 2025.
TATUM — One man has been arrested after an alleged aggravated assault happened at an apartment complex in Tatum on Saturday morning. According to the Tatum Police Department and our news partner KETK, a patrol officer and deputies from the Rusk County Sheriff’s Office responded to a reported aggravated assault at an apartment complex around 12:55 a.m. Saturday.